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25. The records for Sunland Co. show this data for 2021: Gross profit on installment sales recorded on the books was $500,000. Gross profit from
25.
The records for Sunland Co. show this data for 2021:
Gross profit on installment sales recorded on the books was $500,000. Gross profit from collections of installment receivables was $360,000. | ||
Life insurance on officers was $4,600. | ||
Machinery was acquired in January for $380,000. Straight-line depreciation over a ten-year life (no salvage value) is used. For tax purposes, MACRS depreciation is used and Sunland may deduct 14% for 2021. | ||
Interest received on tax exempt Iowa State bonds was $9,800. | ||
The estimated warranty liability related to 2021 sales was $22,400. Repair costs under warranties during 2021 were $14,400. The remainder will be incurred in 2022. | ||
Pretax financial income is $680,000. The tax rate is 20%. |
(a)
Prepare a schedule starting with pretax financial income and compute taxable income. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)
Schedule of Pretax Financial Income and Taxable Income for 2021 | ||
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